We always raise a brow whenever we hear that another multi-level marketing (MLM) company is raiding the town. I know it’s tiring! In just a day or two, your irritating flibbertigibbet neighbors would greet you while you are working on your lawn. Wearing those absolutely hypocrite smiles, they would forcefully start a conversation that you hate more than politicians with brains big as a bean. Later, they would offer you soap, some cream or maybe some tea that would surely “help you lose some weight.” The next day, you would be offered some candles, thongs, mobile applications, and even CBD products. Oh, they’re getting weirder and weirder, you thought. It wouldn’t surprise you if you would be offered an elephant tusk or a throbbing kidney the next week. To your surprise, your neighbor, Pablo, showed you motor oil. Now, we’re talking! Finally, an MLM product fit for a motor lover grown man! But you never heard of an MLM company before marketing motor oils. Is it new? What’s the company’s name? Amsoil? It sounds familiar. You really want the product and consider taking a slight change of thought about MLMs. But, is Amsoil just another piece of MLM crap? Is Amsoil a pyramid scheme? Is it worth the risk?
The Basics
- Company: Amsoil
- Founder: Albert J. Amatuzio
- Product: synthetic oil and other vehicle products
- Website: www.amsoil.com
- Cost to Join: $49.95
The world of MLM industry is owned by lipsticks, tea, CBDs, protein shakes, scented candles, and jewelries. So, it surprised you when you heard that an oil company has been using the MLM industry as well to market its products: Amsoil.
Amsoil is an American corporation based in Superior, Wisconsin. It primarily formulates synthetic lubricants, fuel additives, and filters which helped it to claim its fame. Nevertheless, the way to its present state wasn't easy for the company.
Amsoil was started by Albert J. Amatuzio, a former pilot, who began exploring synthetic engine oils while he was working on the said profession. With his knowledge of planes and jets, he aimed to use the benefits of synthetic oil to automotive engines. With that, Amatuzio developed numerous types of synthetic motor oil formulation and put it into the market by 1968. He started the Life-Tube, Inc. in 1969 which was then renamed Amzoil and was later turned into Amsoil.
However, the start of synthetic motor oil in the market wasn’t an impressive boom for the company. Due to the widespread use of conventional oils, Amsoil’s synthetic oil failed to make a mark among its target market. With this, Amatuzio started North American AMSOIL Dealer in 1973 that uses MLM instead of customary retail sales. This began the numbers of AMSOIL Dealers that educated the market about Amsoil’s synthetic oil. This soon turned into a big success for the company that helped it to reach 60 countries in selling its products via International Distributors.
Amsoil’s fame grew bigger through its AMSOIL 10W-40 Synthetic Motor Oil which was hailed as the first synthetic motor oil in the world that passed American Petroleum Institute (API) service requirements. With that, Amsoil adopted the tagline “"The First in Synthetics®" that reflects the company’s success.
Years later, the company managed to rise from the pool of oblivion through its strategy. Nevertheless, why does it seem that some people are still unaware of the company’s presence?
The Synthetic Products
Amsoil made a faint mark among other typical individuals who are continually using conventional oils. Nevertheless, the company made an overwhelming mark among motor enthusiasts. This attracted the attention of a lot of private professional motorists that soon became loyal customers of the company. Some of them are Joe Carroll, Ted Eaton, Rob Powers and Zachary Nelson.
Due to the Amsoil’s popularity among motorists, the company started sponsoring professional motorcyclists in 1999. It includes Grand National Cross Country which features lengthy cross-country, off-road courses from eight to 12 miles in length and the entire competitions sometimes lasting up to three hours. AMA Supercross Championship is said to be using Amsoil’s products as well in its events.
Synthetic motor oil’s use became more popular in the present times due to its capability to form pure lubricants. Amsoil prides itself through its synthetic lubricants that are chemically engineered and provides better friction-reduction, optimum fuel efficiency, maximum film strength and extreme-temperature performance.
Amsoil also offers other products like gasoline, diesel, filters, transmission fluid, fuel additives, gear lube, cleaners, protectants, bearing, chassis grease, hydraulic oil, compressor oil, and equipment.
Apparently, Amsoil’s products cost higher than any other brands. This is quite typical as many companies that resorted to MLM need to generate higher income to pay its distributors. How about the products? Is it worth the money? Synthetic oils are obviously pricey than any other oils. Nevertheless, one Amsoil 2017 article written by John Baker claims that Black Stone Laboratories “compared rates of engine wear in four different engines using a variety of leading motor oils on the market.” The author claimed that Amsoil performed well in the test. Also Baker said that “Blackstone compared rates of iron wear in three other engines, too. Incidentally, the Amsoil products performed best in two of those three tests.”
I tried to check on the link the author provided and even rummaged the Black Stone Laboratories website for the said claim only to find nothing.
Nevertheless, with years of excellent reputation and specialty of Amsoil in the industry being the first synthetic oil company, it is no doubt that its products are ruling the field.
Compensation Plan
Different from other flashy peacock-like MLM compensation plans, Amsoil’s Market Plan is a four-page compensation plan tackling limited points about how a Dealer generates his or her income. With limited numbers of bonuses and commission and three succession of ranks (Dealer, Direct Dealer, and Direct Jobber), Amsoil’s compensation plan is one of a kind plan. A very simple compensation plan. According to it, here are the ways that a Dealer could earn.
- Retail Profit
First off, in order to be eligible for this profit, an individual must first be considered as an Amsoil Dealer by registering that would cost $49.95. It comes with access to the full line of Amsoil products at Dealer pricing, access to Dealer-exclusive website called the Dealer Zone, a Dealer Starter Kit, free training from Amsoil University Online and a free subscription to Amsoil Magazine.
Once considered as a Dealer, you would be able to buy products at Wholesale (dealer) Cost, which you could pass to your customers at retail cost. This gives you your retail profit.
- Commission Credits
To be able to earn commission on your purchases each month, you as a Dealer must first make not less than one sale at retail to each of five different customers during the month. Also, you must be able to sell the 70 percent of your inventory during the month to receive the commission provided that records of these retail sales are kept. By making those sales, you would have your Commission Credits or the value placed on each product upon which commissions will be paid. This determines the commission you would receive for a specific commission month.
- Sponsored Dealer Commission
Besides receiving commissions from your individual purchases, you may also earn a commission on the individual purchases of Dealers you have sponsored, provided that you also fulfill your own personal minimum requirement.
There are two ways to meet your personal minimum requirement. The first one is by providing a minimum number of 50 individual commission credits; hence you need to provide it by making your own sales of the products. Nevertheless, if it seems impossible to you, you can still meet the personal minimum requirement by being incentive-qualified. This happens when you sponsor or register one qualified Dealer, Preferred Customer or account for the month.
This way, you would be eligible to gain commissions on your sponsored Dealer’s product sales and purchases. Nevertheless, do remember that this commission only comes from the sales your sponsored Dealer makes, and not from the act of recruiting or enrolling the individual.
- Personal Group Commission
A Dealer becomes eligible for this commission from the Personal Group Commission Credit (PGCC) when he or she becomes incentive-qualified AND develops a qualified Direct Group, either personally or down group. Nevertheless that individual shouldn’t be a qualified Direct Dealer (has 3000 or more personal group commission credits in a month and meet the personal minimum requirements) who is eligible to 23 percent commission from PGCC or Direct Jobber (has 3000 personal group commission credits and meet the personal minimum requirements each month for three months.) who is eligible to 23 percent and above commission from PGCC.
After fulfilling this, that Dealer becomes eligible for a 20 percent commission on a Dealer’s personal group commission credits.
- Direct Jobber Performance Commission
After reaching the Direct Jobber position, the individual becomes eligible for this commission as long as he or she manages to meet the set of requirements to keep the position. It includes purchasing products with a minimum value of 100 commission credits or sponsoring two qualified Dealers in the month or 24 in the last 12 months.
The Direct Jobber Performance Commission’s chart shows that as a Direct Jobber, which starts at 3000 PGCC, you would receive 5 percent commission. This 5 percent performance commission will be paid on your first-level qualified Direct Dealers’ personal group commission credits. A Direct Dealer will remain as a part of your personal group until the Dealership qualifies as a Direct Jobber.
This bonus, on the other hand, can grow up to 9 percent upon reaching the 51000 requirement for PGCC.
- Performance Commission Guarantee
This is given to a qualified Direct Jobber based on their personal group commission credits and the number of first level Direct Jobber groups.
Nevertheless, it can also be given to Direct Jobbers who qualified using other methods or alternatives (By being an incentive-qualified sponsor of certain numbers of qualified Direct Jobber groups and maintaining specific amounts of PGCC each month).
In this, those Direct Jobbers would receive a 5 percent performance commission and guarantees to the upline Direct Jobber a performance commission income.
Hence, if a downline Direct Jobber would be able to provide performance commission to his or her upline Direct Jobber, yet does not produce performance commission of $150-$270 to their upline, the difference between the amount actually generated and the amount of performance commission due the upline will be passed up to the upline Direct Jobber.
Income Disclosure Statement
That is one of the things about Amsoil that you must consider before you join the company. How much do its Dealers make? How much would you make when you dive in? Unfortunately, Amsoil’s income disclosure statement is not available to the public. Why not? Is it hiding something? Well, no one knows. If you would try searching the net, you would find not even a record of its earning since it started almost 40 years ago.
The company itself stands brightly with dignity and power. I mean, owning a company like this that produces oil is a great deal. But why is it not joining those flashy MLM companies bravely showing their income disclosure statements, though they are all concocted with complexity and misleading numbers? Why?
As you know, Amatuzio, Amsoil’s founder, resorted to the use of MLM in order for its product to be known in the market. With millions of dollars the company has been generating now from OILS, with its popularity and with other ways to purchase the company’s products, does it even need to boast how much its Dealers are making to attract more recruits? I think not. Nevertheless, I think this is the same idea that obviously makes its MLM compensation plan somewhat outdated. Yes, it is simple but it lacks commissions and bonuses that wouldn’t just attract recruits but would also benefit its current Dealers. Perhaps, it is also the reason why we rarely encounter Amsoil MLM Dealers in this industry. With limited bonuses and compensation and limited ranks to achieve, who would dare joining its team?
The fact that Amsoil offers low percentages in commission is quite something to think about as well. With those numbers, you need to build an army and sell countless products to at least earn a decent income per month. So, should you dive in?
Is Amsoil a Pyramid Scheme? Should I Dive in?
All MLM companies are tainted with stigma of being pyramid schemes and we can’t blame people about it. With the MLM companies’ organization designed from the pyramid structure of illegal pyramid schemes, we tend to see them as one entity. Nonetheless, there is a fine line between a legit MLM and an illegal pyramid scheme.
A pyramid scheme primarily depends on the flow of income being brought by innocent recruits who are promised non-existing products and services. The investments of these recruits feed the higher portion of the pyramid as everyone at the bottom is tricked to recruit more individuals. However, the flow of recruits and investments would soon stop and would cause the inevitable doom of the entire scheme.
On the other hand, legit MLM companies sell products and services that generate income for its members. Nevertheless, the fact that the way MLMs arrange their organizations in the form of a pyramid is truly bothering. In this system, the new recruits are always put into the bottom as the structure grows. While everyone on the bottom is making sales, those at the top suck away portions of their earnings in the form of commission and bonuses. These commissions are being bragged by MLM companies in forms of “perks” when in reality, it is a burden for those at the bottom of the pyramid as parts of their earnings are being sucked away from them.
So, is Amsoil a pyramid scheme? The answer would be a simple “no.” With a weak and unappealing compensation plan and concrete products to sell, we can safely say that it is a legit MLM. Yet, despite being legit, there are still a lot of things that you should consider if you want to join this company.
Weighing Things: Pros and Cons
Unlike MLM companies that are recruitment-driven, Amsoil focuses on making sales out of its products. This is a good thing if you want to find a legit MLM. Nevertheless, this won’t be the only reason you should consider. With that, let’s see the pros and cons of joining Amsoil.
Pros
- The company offers great products. As the first synthetic oil producer in the world, it is no doubt that Amsoil has a great reputation in its field. With that, you could expect buyers looking for some quality products.
- Despite being a big company, the market still seems to be unsaturated with Amsoil's Dealers. That means less competition and more chances of getting recruits.
- Its compensation plan is very simple. One of the simplest compensation plans in the MLM industry that won’t lead you elsewhere.
Cons
- Amsoil is a bit more expensive than other brands. Despite the fact that it is one of the quality brands out there, it could still affect your target market’s choices.
- The company is not showing its income disclosure statement in the public. With you clueless of how much present Dealers earn, that is a red flag for you.
- The compensation plan, despite being simple, lacks ways to compensate its people. What you need is not just a simple compensation plan. What you need is a simple, comprehensible, compensating compensation plan.
- It is an MLM. Yes, despite being legal, MLMs have unfavorable structure for those at the bottom of its system. Who are those people? The recruits and that new recruit could be you. Just imagine your earnings being taken away by somebody else.
Conclusion: The Verdict
After successfully making its name in the market, Amsoil, without a doubt, is one of the successful companies out there; not just as an MLM company but a company with its own identity. The company’s passive characteristic, despite being an MLM, is something worth applauding; no glittery compensation plans and no recruitment-driven motives. However, joining companies like this, not just Amsoil itself but the MLM industry in general, is something you should think a couple of times.
The fact that all MLM companies apply the pyramid structure in the formation of its organization is enough to scare anyone knowledgeable of the trick. You surely don’t want to be a part of such a show, regardless of how reputable the company is. No, you don’t.
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